Savills has closed its office in Hungary in response to the deteriorating central and eastern European market.
The office in Budapest, was opened in 2006 in response to demand from Savills’s German and Irish clients but Property Week has learnt that the firm decided to close the office in favour of servicing the needs of these clients from its other offices in Europe.
A spokeswoman said: ‘The operation, which opened in 2006, was an investment led business and Savills has taken the decision to continue to service clients in this area through its central and eastern European offices, particularly Poland, as well as its London-based cross border investment team.’
It is also understood that Savills’s head of Hungary Peter Chatfield, who was in charge of a team of about five staff, has left the company.
Hungary’s property market, like its neighbouring countries, has suffered as a result of the global economic downturn and tight availability of credit.
According to Cushman & Wakefield research, prime office investment yields, for example, moved out by 25 basis points to 6.25%, at the end of the last quarter.
The firm predicted subdued occupier activity in 2009 coinciding with rising vacancy rates because of a glut of speculative development in the country. Cushman & Wakefield also said investment volumes would remain low pushing yields further out.